(Refiles to restore AgustaWestland legal team details removed
in error)

MILAN Jan 11 (Reuters) - An Italian judge has blocked
demands by India to recover around 300 million euros ($410
million) in bank guarantees from defence group Finmeccanica
in a dispute over a scrapped helicopter deal, two
people with direct knowledge of the matter told Reuters.

India's demands came after the New Delhi government last
week cancelled a 560-million-euro deal with Finmeccanica unit
AgustaWestland for 12 AW101 helicopters over what it termed a
breach of integrity relating to alleged corruption.

The temporary measure in favour of AgustaWestland, which is
represented by the Italian litigation team of Cleary Gottlieb
Steen & Hamilton, will be discussed at a hearing in Milan in
mid-February.

It relates to guarantees with Deutsche Bank SpA, Deutsche
Bank AG, Intesa Sanpaolo and the State Bank
of India, one of the sources said on Saturday, asking not to be
named because the legal proceedings are being conducted behind
closed doors.

"There will be the hearing in 40 days, meanwhile the
tribunal has blocked everything," the source said.

Finmeccanica declined to comment, while the Indian
government and the banks did not respond to immediate requests
for comment.

Indian defence officials have said AgustaWestland had
received just over 43 percent of the deal's value, a sum that
the Anglo-Italian firm matched with bank guarantees to be
reclaimed after the helicopters were delivered.

The overall value of the multi-currency guarantee scheme is
300 million euros but it was not clear whether the State Bank of
India had already paid back to the Indian government around 30
million euros, a source close to the matter said on Saturday.

India froze payments for the contract after Finmeccanica's
then Chariman Giuseppe Orsi was arrested in February for
allegedly paying bribes to secure the deal, embarrassing the New
Delhi government before parliamentary elections due by May 2014.

Orsi and former AgustaWestland head Bruno Spagnolini, who
have both denied for allegations they paid bribes to middlemen
to secure the deal, are being tried in the northern Italian city
of Busto Arisizio.

The separate dispute over the contract, signed in 2010 by
AgustaWestland International Ltd, the British unit of the
helicopter company, will likely be a lengthy process.

New Delhi has agreed to AgustaWestland's calls for
arbitration, which will take place in India and could take
months or even years to complete.
($1 = 0.7314 euros)
(Reporting by Danilo Masoni and Lisa Jucca; additional
reporting by Shyamantha Asokan in New Delhi; Editing by Toby
Chopra)